Bitcoin, pushed by new investors - As Bitcoin is continually breaking new highs, no bubbles seem to be mentioned. With a reputation still not honorable in 2017, the rhetoric has changed, now that financial institutions have entered the game. So this is a different bull market from 4 years ago.
2017, an Asian-fueled bull run
The 2017 bull run is mainly attributed to 2 types of investors: individuals and Asian investors. During that year, Asian markets had flocked to Bitcoin. The reasons ? Depreciation of the yuan, strong appetite for innovation, etc.
Chinese, Japanese and South Korean authorities were taken aback and saw individuals pour their savings into the crypto market. In South Korea and China, the situation was quite favorable to this craze for Bitcoin. Real estate was relatively expensive, and shares of large companies in both countries were at their highest.
In addition, the decade 2010 saw the development of an affluent and young middle class in Asia. So we had new savers and a lack of lucrative investments. Bitcoin did not ask for more.
History doesn't repeat itself, but it rhymes
The fundamental difference between 2017 and now is the price of a bitcoin. By early 2017, it was around $ 1,000. This price was psychologically more acceptable for individuals.
A bitcoin was worth a little less than a month's minimum wage in France. It was a prize that anyone can relate to. Right now, a Bitcoin is worth almost 2 years of minimum wage in France. From a purely psychological standpoint, this asset is now much harder to buy. Additionally, individuals don't always realize that they don't need to own an entire bitcoin to make a profit.
While #Bitcoin has hit ATH this week, a trend has been playing out that could change face of crypto market: a massive flow of coin to US from East Asia. Shift in center of gravity being driven by an increasing appetite for bitcoin among bigger US investors https://t.co/8Zo3CBbjBW pic.twitter.com/8hoCiTfT0i
— Holger Zschaepitz (@Schuldensuehner) December 3, 2020
Ultimately, those who fuel the bull run are those who can and can afford to buy as much bitcoin as they want. These are the dozen companies we have been telling you about for a few months: the famous institutional, the big fish of Wall Street.
Since Paypal and MicroStrategy led the way, announcements have been raining down. And remember, he has as many advertised bitcoin purchases as he has hidden purchases. Suddenly, was the market undervalued in 2020 or will this surge come to an abrupt halt when institutional investors take profits?
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